By Lee C. Chipongian
Remittances sent through the banking system increased by 2.5 percent year-on-year to $19.057 billion as of end-August, the Bangko Sentral ng Pilipinas (BSP) said in a report.
Cash remittances or bank-transferred remittances for the month of August only however dropped by 0.9 percent year-on-year to $2.476 billion.
According to the BSP, the decline was due to lower bank transfers from overseas Filipinos based in United Arab Emirates (UAE), Saudi Arabia and Qatar.
For the January-August period, cash remittances sent by land-based workers went up by 2.1 percent to $15.1 billion, and transfers from sea-based workers increased by 3.8 percent to $4 billion.
About 79 percent of the total cash remittances for the eight-month period came from the US, Saudi Arabia, UAE, Singapore, Japan, United Kingdom, Qatar, Canada, Germany, and Hong Kong, said the BSP.
Personal remittances, or funds not sent via banking networks, increased by 2.4 percent year-on-year to $21.223 billion.
The BSP began reporting personal remittances in June 2012 but previously, these are informally known as remittances through the “padala” system. Personal remittances is defined by the central bank as the “sum of net compensation of employees, personal transfers and capital transfers between households.
BSP Deputy Governor and currently officer-in-charge, Maria Almasara Cyd N. Tuaño-Amador, said personal remittances from land-based workers with work contracts of one year or more rose by 2.1 percent to $16.3 billion, while transfers from sea-based workers and land-based workers with short-term contracts increased by 3.8 percent to $4.4 billion.
But, for the month of August, personal remittances fell by 1.4 percent to $2.76 billion year-on-year.
ING Bank in a commentary said “OFW remittances continue to be a stable source of foreign exchange to the Philippines.”
“The contraction in year-on-year terms shows that the seasonality in remittances continues to shift, mainly due to school year changes as well as to possible late payments to workers,” said ING. “Nuances in exchange rates may have also caused the discrepancy given yearly growth rates.”
The Dutch bank expects 2018 remittances to grow by an average of three percent, same as the BSP’s own estimate of three to four percent.
Last year, cash remittances amounted to $28 billion while personal remittances totaled $31.28 billion, up 4.3 percent and 5.3 percent respectively, from 2016.